Strengthened consumer protections spur for consumption
Chinese Premier Li Qiang recently signed a State Council decree, unveiling revised regulations for the implementation of the Law on the Protection of Consumer Rights and Interests.
Effective from July 1, 2024, the regulations have detailed provisions on the obligations of business operators, including the protection of consumers’ life and property, the handling of defective products, avoiding fraudulent advertisements, price transparency, quality guarantees, and protection of consumers’ personal information. These are all the major complaints of consumers today with the development of e-commerce.
The regulations add provisions on operators’ obligations regarding the protection of the rights and interests of the elderly and minors as consumers.
The regulations also include refined provisions regarding online consumption and stipulate operators’ obligations concerning prepaid consumption, urging them to provide goods or services in accordance with the agreement made with consumers.
The regulations also standardize consumer complaints and compensation claims, stipulating that complaints and reports must abide by the law, regulations and relevant provisions. Furthermore, they should not be used to seek improper benefits, infringe on the legitimate rights and interests of operators, or disrupt the market order.
By effectively addressing the major concerns of consumers, these regulations are conducive to improving the overall consumption environment of the country and they will help spur consumption, a major growth driver.
In the first two months of this year, the total retail sales of consumer goods in China increased by 5.5 percent year-on-year. Online retail sales of physical goods saw an increase of 14.4 percent, accounting for 22.4 percent of the total retail sales of consumer goods. Supermarket retail sales increased by only 0.9 percent year-on-year, while department store sales decreased by 3.0 percent.
From January to February, investment in real estate development fell by 9.0 percent. The sales area of newly built commercial housing nationwide fell by 20.5 percent year-on-year; the sales volume of newly built commercial housing fell by 29.3 percent.
But thanks to the series of policies introduced by the central government, property market sales in many cities have shown signs of stabilization and recovery since March. As the overall macro economy stabilizes and warms up, the property market adjustment is expected to bottom out.
At present, it is necessary to further improve policies and mechanisms to release more space for consumption in the service industry. The factors affecting China’s service industry consumption are mainly shortcomings in service quality, service innovation and consumer rights protection.
Vigorously promoting high-quality innovative development of the service industry can help create more jobs and increase household income. Only by making the service industry better can the country promote a virtuous cycle of industrial upgrading and the expansion of domestic demand in a more balanced way.